Skip to Content

Treasury applications from SAP, components of SAP ERP Financials, comprise a comprehensive suite of cash, liquidity, and financial risk management solutions. These applications provide the ability to conduct sophisticated risk scenario modeling – and execute strategies to mitigate the risks inherent in multinational operations and volatile financial markets.

Treasury applications from SAP also provide comprehensive cash and liquidity management capabilities – including cash forecasting, global cash management, and connectivity with banks via secure electronic payment networks. So you can obtain complete insight into global cash balances, real-time bank statement reconciliations, and straight-through payments processing.

These applications enable more precise cash forecasting, liquidity management, and greater control over financial risk – resulting in reduced operating costs, risk, and banking fees. Complete integration with SAP ERP ensures the most accurate and up-to-date reporting and regulatory compliance.

Treasury applications from SAP provide the following:

  • Cash and liquidity management – Helps you monitor and manage cash flow and liquidity and generates comprehensive and timely cash forecasts and plans
  • In-house cash – Enables centralized control of banking balances, cash management, and payments, and reduces costs of interunit payments, transfers, and bank fees
  • Treasury and risk management – Models risk scenarios and executes mitigation strategies and reduces your organization’s financial risk levels and ensures regulatory compliance

And here are a few of the business benefits of SAP Treasury applications:

  • Improve cash flow and liquidity – SAP ERP Financials automates dispute, credit, and collections management – and offers electronic invoicing and payment capabilities that supplement traditional accounts receivable and accounts payable functions to accelerate and manage cash flow.
  • Optimize global cash management – With SAP ERP Financials, you can report, analyze, and allocate cash in real time, and establish in-house banks or payment centers.
  • Improve process integration between finance and treasury – With SAP ERP Financials, you can integrate risk and treasury transactions with core accounting and financial reporting processes.
  • Reduce overall finance costs – SAP ERP Financials helps you innovate processes, collaborate with supply chain partners, and streamline operations to reduce costs and resource demands.

In order to dive into the specifics of SAP Treasury and Risk Management, here are a few questions to test your knowledge – the answers are at the end so don’t peek.

Q1:  Does the SAP Cash and Liquidity Management application perform automatic completeness checks of cash forecasts?

Q2:  Does the SAP Cash and Liquidity Management application provide cash flow forecasts with freely definable planning horizons?

Q3:  Does the SAP In-House Cash application support administration and controlling of intercompany credit facilities?

Q4:  How do treasury applications from SAP handle, report, or show open netting positions?

Q5:  Do treasury applications from SAP provide electronic credit and debit entries required for calculating open items?

Q6: Can existing interest rate structures and redemption schemes be changed ex post in the SAP Treasury and Risk Management application? Do these changes automatically effect new calculation of future interest payments?

Q7:  Can the SAP Treasury and Risk Management application manage internal and external credit lines?

Q8: Can the SAP Treasury and Risk Management application support integration of the letter of credit tracking solution with the purchasing solution and the accounts payable solution?

Q9:  Does the SAP Treasury and Risk Management application support gap analyses based on aggregating cash flows per time bucket?

Q10:  Can different conventions for interest rate cashflows be set for financial market, equity market, and bond transactions depending on the counterparty or depository?

                        _____________________________________________

Here are the answers:

Q1:  Does the SAP Cash and Liquidity Management application perform automatic completeness checks of cash forecasts?

Answer:  Yes, the SAP® Cash and Liquidity Management application performs automatic completeness checks of cash forecasts. This requirement could be covered by a status and tracking application.

Q2:  Does the SAP Cash and Liquidity Management application provide cash flow forecasts with freely definable planning horizons?

Answer:  Yes, the SAP® Cash and Liquidity Management application provides cash flow forecasts with freely definable planning horizons.

Q3:  Does the SAP In-House Cash application support administration and controlling of intercompany credit facilities?

Answer:  Yes, the SAP® In-House Cash application supports administration and controlling of intercompany credit facilities. Credit lines can de depicted in two ways in SAP software. First, so-called facilities are available, which allow depiction of utilization and the fees attached to these. Transactions that have to be offset from these lines, must explicitly be allocated to the facility.

Another option is to automatically offset transactions over the credit risk analyzer (CRA) module to predefined limit (“credit line”). As part of the CRA, separate securities administration is also available, which can also lead to crediting for a credit line.

Q4:  How do treasury applications from SAP handle, report, or show open netting positions?

Answer:  Netting positions between group companies are regulated centrally through internal settlements. The sum of all transactions of a net participant regulated in this manner is calculated as the balance of a receivable or account payable vis-à-vis the operating company of the netting application (normally the corporate headquarters).

Open netting positions are depicted as open postings on debitor and creditor accounts. They are treated in much the same way as ist he case with normal debitor or creditor accounting. To reconcile inter-company receivable or account payables, treasury applications from SAP provide a special reconciliation tool.

Q5:  Do treasury applications from SAP provide electronic credit and debit entries required for calculating open items?

Answer:  Advice of settlement can be sent as printouts and electronically. In treasury applications from SAP it is not necessary to compile separate credit notes and debit notes, as various balance details can already be included in the corresponding account statements. Balance details are transferred in a structured form. The only technical limitations are on the number of transferred datasets for invoice details.

Q6: Can existing interest rate structures and redemption schemes be changed ex post in the SAP Treasury and Risk Management application? Do these changes automatically effect new calculation of future interest payments?

Answer:  Yes, existing interest rate structures and redemption schemes can be changed ex post in the SAP® Treasury and Risk Management application. These changes automatically effect new calculation of future interest payments.

Q7:  Can the SAP Treasury and Risk Management application manage internal and external credit lines?

Answer:  Yes, the SAP® Treasury and Risk Management application can manage internal and external credit lines.

Q8: Can the SAP Treasury and Risk Management application support integration of the letter of credit tracking solution with the purchasing solution and the accounts payable solution?

Answer: Yes, the SAP® Treasury and Risk Management application supports integration of the letter of credit tracking solution with the purchasing solution and the accounts payable solution.

Q9:  Does the SAP Treasury and Risk Management application support gap analyses based on aggregating cash flows per time bucket?

Answer:  Yes, the SAP® Treasury and Risk Management application supports gap analyses based on aggregating cash flows per time bucket.

Q10:  Can different conventions for interest rate cashflows be set for financial market, equity market, and bond transactions depending on the counterparty or depository?

Answer:  Yes, the SAP® Treasury and Risk Management application lets you set different conventions for interest rate cashflows for financial market, equity market, and bond transactions depending on the counterparty or depository, with standing instructions for financial transactions, and with sort master data for bond transactions.

                        _____________________________________________

To learn more about SAP Treasury and Risk Management, I recommend you try the FSC010, FSC120, and AC805 training courses provided within SAP Education’s Treasury and Risk Management Learning Map.

To report this post you need to login first.

Be the first to leave a comment

You must be Logged on to comment or reply to a post.

Leave a Reply